Look, there is a bit in the WTO arrangements that lets any country break any copyright or IP clause if it needs to do so in the event of a 'national emergency'. So if Swiss based Pharma X has a vaccine for TB+ and an outbreak of TB+ hits Chicago on a 'national emergency' scale then uncle Sam can make the vaccine.

Many African countries have massive problems with HIV/Aids easily enough to trigger the national emergency issue. (Just imagine if this was happening in Louisiana)

However they don't have the factories, technology or know how to break the patent. This is why firms in India and Brazil have now done it for them which apparently is illegal. Recently a few big pharma firms accepted this to avoid a wholesale rewriting of the rules.

Of course what's really bugging you is the insinuation in the article that your government has been bought. It has.

M

Following up my last bit... I should check the rules (which doesn't mean I will) imagine a bunch of UN scientists and mobile facilities being sent to African nations that need this stuff to bust the clause about having to be made onsite...

M

No, Martin, sorry, that's not really bothering me. I've never met a government that wasn't bought.

Anyway, the national emergency clause you speak of doesn't begin to address the statistical case I made: if such mobile teams as you suggest were to be set up, would it lower drug company's profits to the point they're not made again?

You're the one who worries about the U.S. being bought. I just want to make sure the price is right.

Hmm, from a man who once told me (at length over many drinks) that special interest donations *could not* buy influence thats interesting.

Interestingly evidence from drugs where patents have expired suggests that pharma companies can sustain supernormal profits against generic drugs through superior brand awareness. (I want *real* Paracetamol...). On the other hand there's no point denying that this wouldn't collapse profits.

The argument then becomes does this collapse profits to the point where R&D ceases or slows significantly? In theory given the market failure that currently exists this is an ideal point for state intervention...

Governments would appropriate some of the savings produced by drugs being cheaper and invest these in R&D. So when the NHS's prescription drug bill falls by $2Bn a year the govt offers a $1Bn a year contract for the development of treatments x,y and z. Merck, Pfizer, Glaxo and co all bid.

This results in a clear connection between what Big Pharma claims it needs money for (R&D) and what they get paid for (R&D). Meanwhile drug prices to the end user drop and R&D can be targetted more effectively since govts can co-operate to efficiently use funds rather than see companies 'race' each other to the same goal with 50% of the investment ultimately being lost (there is a name for that inefficiency but I forget it).

Alternatively govt keeps the savings and uses them to buy out patents that are developed commercially. More competition, but much greater likelihood of the 'race' inefficiency described above.

I've prepared you a reading list on this debate at Monograph if you haven't noticed - more cause I needed to brush up myself than anything else.

Saw the list. I'm saving it as a reward for when I'm done with my contracts outline. ;)

As for the "special interest donations can't buy politicians"/"all governments are bought" discrepancy: I don't think it's the drugs companies who are doing the buying, at least not through donations. Politicians are in hock to the fact that these are domestic industries, that economically being the center of the worlds drug development is pretty useful, and through the jobs (mmmmm.... white-collar, high-tech jobs) it supports. In the meantime, AIDS victims in Africa just aren't a big constituency.

On the other hand, European governments don't have a constituency in either (a) American drug firms whose profits are at stake or (b) AIDS victims in Africa, so they can move with their constituencies, heart-on-sleeve. See? All governments bought, no donations required. ;)

I question how much profit the drugs companies are losing if poor Africans making the equivalent of $1 a month are getting freebies. Besides, it would make some good PR to show drug company CEOs handing out pills in hospitals.

In any event free AIDS drugs are not the answer to this problem. Why? Because there is no cure for AIDS. The drugs do prolong life and probably alleviate suffering, however they do not "save" any lives, because the people taking those drugs will still most likely die from AIDS. On the other hand, condoms and sex education do assist in preventing people getting infected in the first place, thus saving lives. Money and effort spent on copying and arguing about generic AIDS drugs would be better spent on education.

"I question how much profit the drugs companies are losing if poor Africans making the equivalent of $1 a month are getting freebies." Are you suggesting that because these people could not pay much, American drug companies could provide the medication for free without losing any profit?

It's certainly true that, if the drug companies were going to sell drugs to impoverished African AIDS victims anyway, they would sacrifice very little by providing those drugs for free. But, of course, the drug companies aren't going to sell to $1-a-month wage earners because it wouldn't be enough to recoup the average cost of producing the medication (including R&D). (I exclude the unlikely scenario where the high fixed costs have already been paid but the marginal cost of producing the medication is absurdly low -- consider selling an empty seat on an airplane -- in which the drug company might sell below average cost.)

One also has to consider that in many cases, the best use that the possessors of the newly created generic drugs will have for them is to sell them on the worldwide market, even if it's a 'grey' area...

Let me also throw in that were the U.S. to eliminate to 1. eliminate the global "gag rule" that results in some health clinics in Africa losing foreign aid because they dare suggest abortion 2. eliminate our absurd agricultural subsidies (and coerce the EU to do the same) the long-term health of Africa might be improved, because, as FalconRed pointed out, AIDS drugs are not long-term solutions.

Tis true, what the world needs is condoms not catholicism (see the Brazilian success story), free trade not aid (although aid is nice) and generic drugs.

On the news last night some African state of 1m people, 400 000 are HIV +ve, of which 180 000 are adults. In otherwords atleast half the future generation of this nation will be HIV +ve.

For nations like this AIDS drugs are the only way to avoid economic meltdown.

Will some of these drugs end up on the grey market - hell yes. In the mean time I question Tony's assertion that all big pharma companies are American, as are all their laboratories, factories and suppliers. (I don't know, it just seems unlikely)

Not all--and most of them are pretty global in scope these days anyway. But there's a substantial American edge in that market. And, in a global market, the higher drug prices in the U.S. will still provide a greater percentage of the profits of even foreign producers, at least on a pill-for-pill or project-for-project basis.

In my opinion for nations like this AIDS drugs are the only way to avoid economic meltdown, because event free AIDS drugs are not the answer to this problem, because there is no cure for AIDS. The drugs do prolong life and probably alleviate suffering; however they do not "save" any lives, because the people taking those drugs will still most likely die from AIDS.

Sadly, every year is closely related.
To protect their exorbitant profits, drug companies are fighting the production and distribution of cheap generic versions of patented drugs. Unable to afford the medicines necessary to save their lives, millions of poor people die of treatable illnesses every year.